Does the level of Steal materia affect steal %?

The only factors in the formula for Steal in Final Fantasy 7 are:

• Your level (the higher, the better)
• The enemy's level (the lower, the better)
• The item chance, which is different for each potential stolen item. Rarer items tend to have a lower chance.

For multiple potential stolen items, the items are organized into slots and checked sequentially until one steal attempt is successful or all items have been attempted. Thus, it is generally easier to steal items in the early slots, even without factoring in the lower item chance usually attributed to the later slots.

Having the Sneak Glove equipped overrides parts of the formula related to the level differences, but otherwise does not change the system that much.

There is an element of randomness to stealing, but it is unaffected by luck. The level of the Materia is also irrelevant.